Auditor Bargaining Power and Audit Fee Lowballing

Shaowen Hua, Zenghui Liu, Xiaojie Christine Sun, Ji Yu

Research output: Contribution to journalArticlepeer-review


Incoming auditors usually charge fewer audit fees to obtain the client (i.e., audit fee lowballing). Prior research shows that industry expert auditors have better expertise and resources to perform a higher quality audit than non-expert auditors. Consistent with this literature, we predict and find empirical evidence that the magnitude of lowballing will be significantly smaller for industry expert auditors compared with non-expert auditors. This result adds new evidence of the impact of auditors’ bargaining power to the audit fee lowballing literature.
Original languageAmerican English
JournalAdvances in Business Research
StatePublished - Dec 31 2016
Externally publishedYes


  • Audit fees
  • bargaining power
  • industry expert auditor
  • lowballing


  • Business
  • Accounting
  • Statistics and Probability

Cite this